LouisianaVoice has obtained a letter from a New Orleans law firm demanding payment of almost $7.9 million owed by the Recovery School District (RSD) of New Orleans to an Illinois company contracted to provide transportation to RSD students.
The letter confirms earlier reports by LouisianaVoice that RSD was in arrears by nearly $6.6 million in payments to Durham School Services.
At the same time, LouisianaVoice also received a copy of a July 13 letter from Durham notifying about 170 bus drivers and monitors that their jobs were being terminated, effective Aug. 6 as a result of failure of RSD and the Louisiana Department of Education (DOE) to remit contractual payments to Durham.
The letter from Jones Walker Law Firm, dated June 27, was addressed to DOE Superintendent John White and RSD Superintendent Patrick Dobard. In addition, copies were also mailed to each member of the Board of Elementary and Secondary Education.RSD – Durham Letter
“On Feb. 24, 2012, Durham advised DOE and RSD of their breach of the agreements for failing to timely pay for invoiced transportation services,” the letter said. “At that time, the past due amount was $4,494,291.44. Since then, not only have DOE and RSD failed to remedy this breach, but the past due balance has significantly increased.”
The total past due amount quoted in that letter was $6,568,694.81.
“Durham has attempted to engage in good faith discussions with representatives from RSD regarding this matter, but so far a satisfactory resolution has not been reached,” attorney Michael DePetrillo said in the letter. “Durham has also tried to meet with representatives from DOE, who have not yet committed to meeting with Durham on these issues.
“It is my understanding that DOE and RSD have proposed in writing to pay $3.5 million to Durham by July 6 with the remaining balance owed for the 2011-2012 school year paid to Durham by Dec. 31, 2012. Durham, however has not been provided with any assurance regarding these payments nor an indication as to the confirmed source of funding for these payments.”
DePetrillo also cited the outstanding balance of nearly $217,000 due from the defunct Sojourner Truth Academy. “Durham was forced to file a lawsuit and recently obtained a judgment for $216,835.42,” he said. “The problem Durham now faces, in light of Sojourner Truth Academy’s closure, is whether Durham will be able to collect for this debt.”
He said two other invoices not yet billed—for $1,200,594.30 and $108,288.40 bring the total owed by RSD and DOE to $7,877,577.51.
White has said that a payment agreement has been reached with Durham but that has not prevented the loss of 170 jobs.
Part of the loss could stem from the drop in enrollment at RSD schools by nearly 2,000 students.
The letter from Durham to drivers and monitors, however, would seem to indicate that the delinquent payments are largely to blame and that, contrary to White’s claims, no formal agreement for a payment schedule has been reached.
“We wanted to update you on the status of our contract renewal discussions with the Louisiana Recovery School District and the Department of Education,” it said. “We are currently owed a substantial sum of money by the RSD. They had promised to make a partial payment on July 6, but that deadline has now passed without payment.
“Durham also requested assurances from the RSD and DOE regarding repayment of the remaining debt, but the RSD’s subsequent representations were unsatisfactory. Although we hoped to resolve these issues so we could continue to operate for the RSD, it is now clear that Durham cannot realistically maintain this expectation any longer.
“As a result, your position is being terminated, effective August 6, 2012. We will notify you if anything changes in our discussions with the RSD; however, we have no such expectation this will occur.”
Could this be yet another attempt by White to “fill the room with air” as a means of deflecting attention from the real problems?